Virginia legislators have paused the consideration of bills to legalize iGaming to allow for further research and the consideration of establishing a new state gaming commission. Senators Mamie Locke and Representative Marcus Simon introduced bills SB827 and HB2171 in January 2025, respectively, but requested a pause in proceedings to further study industry impacts. A joint subcommittee is currently investigating the feasibility of establishing a Virginia Gaming Commission, which plans to complete its work by November 30. Supporters claim that the legalization of iGaming could bring in $5.3 billion in new revenue over five years and combat illegal gambling, but the Virginia Lottery and some operators have expressed opposition. Since the launch of sports betting in 2021, the state has generated $24.7 billion in wagers and $2.4 billion in revenue.
Legislative Process and Bill Suspension
Virginia legislators paused the bill proceedings to legalize iGaming in January 2025. The bills proposed by Senator Mamie Locke, SB827, and Representative Marcus Simon, HB2171, were shelved to allow for more industry research.
The decision to pause is related to the state's odd-year legislative session being shortened to 30 days, with legislators feeling more time is needed to fully assess the impacts and regulatory framework of iGaming.
Research Group and Committee Planning
A joint subcommittee is investigating the feasibility of establishing a Virginia Gaming Commission, which was formed in 2023 to assess the possibility of a new gaming regulatory body. The subcommittee plans to meet next week and complete its work by November 30.
Virginia Public Broadcasting reports that establishing a new regulatory body may be a priority during the 2026 legislative session, as legislators believe it needs to be in place before further expansion of the gaming industry.
Bill Content and Proposed Framework
The suspended bills proposed authorizing the Virginia Lottery Commission to issue online casino licenses. According to the proposal, operators would need to pay a $1 million application fee and a 15% revenue tax.
The state's five brick-and-mortar casinos could each apply for up to three iGaming operating licenses, allowing them to offer online casino gaming services.
Economic Expectations and Supportive Views
Supporters believe that legalizing iGaming will combat illegal and offshore gambling activities. Representative Simon stated that legalization could bring up to $5.3 billion in new revenue over five years without creating a new gambling market, merely regulating existing activities.
Supporters emphasize that Virginia residents are already participating in online gambling, but the state is unable to collect any tax revenue from these activities.
Opposition Opinions and Industry Concerns
The Virginia Lottery opposes the expansion of iGaming, stating that the agency is already overwhelmed with five casinos at different stages of development. Cordish Companies, a casino operator in the state, is a major opponent of the expansion of online casinos nationwide.
Cordish and Churchill Downs Inc. have jointly formed the National Anti-Internet Gambling Association, aimed at opposing efforts to legalize iGaming.
Industry Impact and Campaign Donations
The Sports Betting Alliance (including major operators such as FanDuel and DraftKings) has donated over $2 million to Virginia legislative election candidates. According to Virginia Public Broadcasting, the gambling company's campaign donations rank second in the state, only behind Dominion Energy.
The association declined to comment on the donation matters, but the scale of donations indicates the industry's emphasis on the Virginia market.
Existing Sports Betting Performance
Virginia legalized sports betting in 2020, and since its launch in January 2021, the market has generated $24.7 billion in wagers and $2.4 billion in revenue.
The success of sports betting provides a backdrop for the iGaming discussion, with supporters believing that a similar regulatory model could be applied to online casino games.
Expert Opinions and Lessons Learned
David Rebuck, former director of the New Jersey Division of Gaming Enforcement, stated at an August subcommittee hearing that concerns about iGaming cannibalizing brick-and-mortar casinos in New Jersey did not materialize.
Rebuck noted, "iGaming has proven to be a complement to existing forms of gaming and is crucial for sustaining the growth of brick-and-mortar casinos."
Legislative Timetable and Future Outlook
Due to the potential restructuring of the legislature after the November elections, a serious attempt at the iGaming bill may have to wait until the 2026 legislative session. The work of the research group will provide a foundation for next year's legislation.
Supporters hope the research will help develop a feasible iGaming legalization plan, balancing revenue opportunities with potential social impacts.
Regulatory Considerations and Implementation Challenges
Establishing a new gaming commission may be an important component of the regulatory framework. Legislators believe that a dedicated regulatory body would better oversee the expanding gaming market.
The regulatory framework needs to consider aspects such as license issuance, tax collection, consumer protection, and responsible gambling measures.
Economic Environment and Budget Pressures
Virginia faces budget pressures, and new sources of revenue are attractive. The potential $5.3 billion in revenue from iGaming could be used for education, infrastructure, or other priorities.
Economic considerations will be an important factor in legislative decisions, especially in the context of tax competition with other states.
Social Impact and Responsible Gambling
Legislators need to weigh economic benefits against potential social costs, including problem gambling and addiction risks. Responsible gambling measures may be an essential part of any legalization bill.
By learning from the experiences of other states, Virginia can develop a comprehensive consumer protection framework.
